/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/020909.mbx T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Monday, September 9, 2002, Vol. 3, Issue 178 Headlines A R G E N T I N A SCOTIABANK QUILMES: New Owners Resume Operations at 91 Branches B E R M U D A FOSTER WHEELER: Wins CFB Boiler Plant Order From Stora Enso GLOBAL CROSSING: Gets More Writs For Four Subsidiaries B R A Z I L AES CORP: Brazilian Unit Ups Dividend Remittances TELEMAR: Schedules Extraordinary General Shareholders' Meeting C H I L E MADECO: Fitch Lowers Ratings; Warns of Further Downgrade M E X I C O CFE: Re-launches Tender For El Cajon Hydro Project ENRON: Tractebel Buys 20% Stake In Cogeneration Plant GRUPO SIDEK: Announces August Asset Sales Report HYLSAMEX: Details of the Ongoing Capitalization Process ISPAT INTERNATIONAL: Extends Expiration Date For Exchange Offer UNEFON: Blames Conflict With Nortel For Recent Default P A N A M A AES PANAMA: Completes $275M Financing for Two Hydro Facilities P U E R T O R I C O SANTANDER BANCORP/BANCO SANTANDER: Fitch Downgrades Ratings U R U G U A Y ANCAP: Partner Search Suffers Setback V E N E Z U E L A SIDOR: Braces For Possible Strike Over Contract Conditions - - - - - - - - - ================= A R G E N T I N A ================= SCOTIABANK QUILMES: New Owners Resume Operations at 91 Branches --------------------------------------------------------------- Banco Comafi and Banco Bansud reopened Wednesday the 91 branches they recently acquired from Scotiabank Quilmes, which was suspended in April due to liquidity problems. Scotiabank Quilmes was intervened and suspended when Canadian parent Scotiabank refused to inject more capital into the ailing bank. Comafi and Macro-Bansud made a joint bid for Scotiabank Quilmes, which was accepted by the central bank in August. Comafi took 55 of the branches, most of them located in the capital Buenos Aires, while Macro-Bansud added 36 branches to its distribution network. Scotiabank Quilmes has been ravaged, along with the rest of Argentina's banking system, by a four-year recession that forced the government to default on most of its public debt, devalue the peso in January and freeze deposits after a run on banks sapped about 25% of deposits last year. ============= B E R M U D A ============= FOSTER WHEELER: Wins CFB Boiler Plant Order From Stora Enso ----------------------------------------------------------- Foster Wheeler Ltd.'s (NYSE:FWC) Finland-based subsidiary, Foster Wheeler Energia Oy, has signed an agreement with the forest products company, Stora Enso, to supply a 130 MWth circulating fluidized bed (CFB) boiler plant to the company's Kvarnsveden paper mill in Borlange, Sweden. The contract with Stora Enso Kvarnsveden AB, which has a production capacity of 700,000 t/a of newsprint and magazine paper, includes the CFB boiler, plant building, fuel silos, electrical systems, instrumentation, automation, and stack. Foster Wheeler's delivery forms the bulk of a new investment at Kvarnsveden, which totals approximately $54.5 million in value and is aimed at improving the mill's overall environmental performance. The new Foster Wheeler-supplied boiler will be fired on a mixture of bark, mill sludge, and coal, and will replace an existing grate-fired unit. The plant is scheduled to be commissioned in late 2004. Foster Wheeler's experience as a supplier to the forest products industry, together with its global leadership in CFB technology, were key factors contributing to winning this contract, according to CEO Timo Kauranen of Foster Wheeler Energia Oy. Foster Wheeler's CFBs and bubbling fluidized bed (BFB) boilers have an excellent track record of delivering high levels of efficiency and availability, and are capable of firing a wide variety of fuels-including many difficult-to-burn biofuels-with very low levels of environmental emissions. Foster Wheeler Ltd. is a global company offering, through its subsidiaries, a broad range of design, engineering, construction, manufacturing, project development and management, research, plant operation and environmental services. The corporation is based in Hamilton, Bermuda, and its operational headquarters are in Clinton, N.J. For more information about Foster Wheeler, visit our World-Wide Web site at www.fwc.com. CONTACT: Foster Wheeler Ltd. Media: Sherry Peske, 908/730-4444 or Other Inquiries: 908/730-4000 GLOBAL CROSSING: Gets More Writs For Four Subsidiaries ------------------------------------------------------ New writs have been filed in the Bermuda Supreme Court concerning four Global Crossing subsidiaries: Global Crossing Holdings Ltd., Pac Panama Ltd., South America Crossing Ltd. and Global Crossing Intellectual Property Ltd. The Royal Gazette reports that the writs, which were filed in the matter of the Companies Act 1981, listed Appleby Spurling and Kempe (AS&K) as the attorney. On August 9, Global Crossing was sold for US$250 million to Hutchison Whampoa of Hong Kong and Singapore Technologies, much lower than an initial offer of US$750 million. The deal was approved by the judge overseeing Global Crossing's bankruptcy case. Under the original deal with the two Asian firms, announced in January with the bankruptcy filing, Global Crossing's debtholders would have split US$300 million in cash and an additional US$800 million in new notes from the Company. Now, they will still get US$300 million in cash, but only US$200 million in notes. They will, however, retain a larger stake of the equity in the new firm: 38.5% rather than the 21% envisioned under the earlier deal. Meanwhile, although Hutchison and Singapore will receive a smaller controlling stake - 61.5% instead of the 79% stake rejected in the first deal - they will only being paying US$125 million each in cash rather than the combined US$750 million they were willing to pay in January. Owners of Global Crossing's existing stock will receive no stake in the reorganized company. Lawyers for Global Crossing told the court last month that the company expects to file a Chapter 11 plan of reorganization this month and to emerge from bankruptcy in early 2003, subject to satisfying various contractual and regulatory conditions. CONTACT: GLOBAL CROSSING Press: Becky Yeamans, +1-974-410-5857, Email: Rebecca.Yeamans@globalcrossing.com Tisha Kresler, +1-973-410-8666 Email: Tisha.Kresler@globalcrossing.com Analysts/Investors: Ken Simril, +1-310-385-5200 Email: investors@globalcrossing.com ATTORNEY: APPLEBY SPURLING & KEMPE Cedar House 41 Cedar Avenue PO Box HM 1179 Hamilton HM EX Bermuda Tel: +441 295 2244 Fax: +441 292 8666 Email: askcorp@ask.bm =========== B R A Z I L =========== AES CORP: Brazilian Unit Ups Dividend Remittances ------------------------------------------------- The dividends that the ailing U.S.-based power giant AES Corp. get from its Sao Paulo-based unit, the electric power generator AES Tiete, are getting bigger. In the first-half of the year, the pay out (relation between dividends/profits) reached 78%. AES Tiete is increasing its dividend remittances to its parent in order to help the group overcome its financial crisis. AES Tiete's net worth dropped from BRL698 million in 2000 to BRL572.5 million by June 2002. AES holds 53% stake in AES Tiete and aims to sell it off, according to market sources. AES acquired the Brazilian generator in 1999 during an auction promoted by the Sao Paulo state government. The consortium paid BRL938 million for its control. CONTACT: AES CORP 1001 North 19th Street Arlington, VA 22209 Phone: (703) 522-1315 Fax: (703) 528-4510 E-mail: investing@aesc.com Home Page: http://www.aesc.com/ Contact: Roger W. Sant Paul T Hanrahan TELEMAR: Schedules Extraordinary General Shareholders' Meeting -------------------------------------------------------------- The Board of Directors of TELE NORTE LESTE PARTICIPACOES S.A. calls the Company's shareholders for an Extraordinary Shareholders' Meeting on September 20, 2002, at 10:00 am at the Company's headquarters, at Rua Humberto de Campos, 425 (3rd floor), Leblon, in the city of Rio de Janeiro, RJ, to deliberate and vote on the items of the Agenda which include: (i) to alter the article 27 of the Company's Bylaws, which defines the composition of the Board of Executive Officers, which shall be composed of a minimum of two and a maximum of six members, being one President Director (CEO), two Superintendent Directors and three Directors with no specific designation; and (ii) to alter other articles of the Bylaws to reflect the changes specified above. General Information 1. All powers of attorney to vote at the Ordinary and Extraordinary Shareholders' Meeting must be delivered to the attention of the Company's legal department at the Company's headquarters located in the city of Rio de Janeiro, RJ, at Rua Humberto de Campos, n§ 425, 7th floor, Leblon, at least 2 (two) business days prior to the date of the Meeting. 2. Shareholders whose shares are registered with a custodial agent, who wish to vote their shares at the Extraordinary Meeting, must present a statement issued no later than 2 (two) days prior to the date of the Meeting by the custodial agent, indicating the amount of shares of the Company held by shareholders as of said date. Rio de Janeiro, September 4th, 2002 Fersen Lamas Lambranho Chairman of the Board of Directors ========= C H I L E ========= MADECO: Fitch Lowers Ratings; Warns of Further Downgrade -------------------------------------------------------- International credit rating agency Fitch lowered its local currency rating for Chilean copper and wire manufacturer Madeco to BBB-from BBB+, and assigned the rating a "negative" outlook. The downgrade, according to Fitch, was due to Madeco's deteriorating financial situation, a result of the worsening economic performances of the markets (Chile, Argentina, Brazil and Peru) and sectors in which it operates. Fitch warned that it would reduce the Company's rating even further if it fails to raise the planned US$90 million in an equity issue this month, as part of a debt-restructuring plan. Madeco has closed its plants in Argentina, while the acute contraction of the electric power and telecommunication sectors in Brazil is threatening the debt-ridden company's ventures there too. Madeco's efforts to reducing its high debt levels have been hampered by lower operating margins. And, with bleak economic prospects in Argentina and Brazil, Fitch sees little likelihood of Madeco turning around the net losses it has recently reported. The company posted a loss of CLP17.1 billion (US$24.9 million) for the first half of this year, up 88% compared to a loss of CLP9.1 billion for same-period 2001. Madeco plans to issue 1.8 billion shares at CLP35 each to raise a total of CLP63 billion (US$88 million at current exchange rates) to remain open for 30 days from September 9 to October 8. Its majority shareholder, Chile's Luksic group, has publicly committed itself to taking up its 56.5% pro rata portion of the capital issue but analysts say that minority shareholders may not be interested in doing so. The company plans to use US$60 million of the capital increase to pay off half of its short-term debt of US$120 million. The other half will be paid off over seven years with three years grace under agreements reached with creditor banks. Any remaining funds would be used as working capital. Late last year, Madeco hired investment bank Salomon Smith Barney to help it restructure debts amounting to US$325 million. The debt consists of roughly US$100 million in long-term bonds, US$120 million in bank loans and US$100 million related to Madeco's subsidiaries. To see latest financial statements: http://bankrupt.com/misc/Madeco.doc CONTACT: MADECO S.A. Ureta Cox, 930 San Miguel, Santiago, Chile Phone: 56-2 5201461 Fax: 56-2 5516413 E-mail: mfl@madeco.cl Home Page: http://www.madeco.cl Contacts: Oscar Ruiz-Tagle Humeres, Chairman Albert Cussen Mackenna, Chief Executive Officer Investor Relations Phone: 56-2 5201380 Fax: 56-2 5201545 E-mail: ir@madeco.cl SALOMON SMITH BARNEY HOLDINGS INC. 388 Greenwich St. New York, NY 10013 Phone: 212-816-6000 Fax: 212-793-9086 Home Page: http://www.smithbarney.com Contact: Michael A. Carpenter, Chairman and CEO Michael J. Day, EVP and Controller =========== M E X I C O =========== CFE: Re-launches Tender For El Cajon Hydro Project -------------------------------------------------- Mexico's state power company CFE re-launched a tender for the MXN10.6-billion (US$1.07 billion), 750MW El Cajon hydro project in Nayarit state, Business News Americas reports, citing a statement published in the government's official bulletin. The tender was supposed to be launched June 27 but the Company delayed the process in order to give the country's controller ample time to review bidding rules. Construction was originally scheduled to begin end-2002, with operations planned for early 2007. The government will solicit bids under the terms of the Pidiregas capital expenditure financing scheme, which was set up to allow private investment in infrastructure projects for CFE and state oil monopoly Pemex. The plant, which will operate with two 375MW vertical Francis turbines, will serve to regulate flow at Mexico's largest hydro plant, Aguamilpa, 60km downstream from the proposed El Cajon site, which in turn is 47km from the city of Tepic on the Santiago River. CFE is reported to be currently in need of help to carry out its investment program in 2011. Industry-wide upgrade is said to be required in order for the company to meet the MXN560 million (US$57.6 billion) it needs in the coming decade. CONTACT: COMISION FEDERAL DE ELECTRICIDAD Rio Rodano 14, Col. Cuauhtemoc 06598 Mexico, D.F., Mexico Phone: +52-55-5229-4400 Fax: +52-55-5310-4614 http://www.cfe.gob.mx Contacts: Alfredo Elias Ayub, General Director Arturo Hernandez Alvarez, Director of Operations Francisco J. Santoyo Vargas, Director of Finance ENRON: Tractebel Buys 20% Stake In Cogeneration Plant ----------------------------------------------------- Belgian power company, Tractebel, bought bankrupt US-based Enron's 20% stake in a US$189-million, 245MW cogeneration plant. The deal makes Tractabel 100% owner of the plant that is currently under construction in Mexico's Nuevo Leon state capital Monterrey, Business News Americas reports, citing Tractebel spokesperson Cindy Suggs. Tractebel didn't say how much it paid for the stake "because of a confidentiality agreement signed between the two parties on completing the deal," Suggs said. Enron filed for bankruptcy protection early December 2001 in the largest Chapter 11 case ever after Dynegy Inc. abandoned its US$23 billion takeover of the Houston-based energy trader. Enron listed about US$40 billion of debt, including off-balance-sheet project financing. CONTACTS: Mark Palmer of Enron Corp., +1-713-853-4738 Enron Corp. Investor Relations Dept. P.O. Box 1188, Suite 4926B Houston, TX 77251-1188 (713) 853-3956 Email: investor-relations@enron.com Enron Corp. Public Relations Dept. P.O. Box 1188, Suite 4712 Houston, TX 77251-1188 (713) 853-5670 GRUPO SIDEK: Announces August Asset Sales Report ------------------------------------------------ Grupo Sidek, S.A. de C.V. (OTC: GPSAY, GPSBY) announced Thursday a report regarding assets sales from August 1, 2002 to August 31, 2002, pursuant to its obligations under the restructuring agreements entered into with Sidek Creditor Trust: ASSETS SALES REPORT FROM AUGUST 1, 2002 TO AUGUST 31, 2002 (Figures in US$ thousands) Assets with Reorganization Value higher than USD$ 5,000 Sales Reorganization Value Value I. Hotels 0 0 II. Real Estate 0 0 III. Marinas and Golf Courses 0 0 IV. Other 0 0 Subtotal 0 0 Assets with Reorganization Value less than USD$ 5,000 Subtotal (transactions) 788 N.A. Total 788 N.A. NA / Not available CONTACT: GRUPO SIDEK, S.A. DE C.V. Alejandro Giordano Trejo +011-52-55-5726-1227 HYLSAMEX: Details of the Ongoing Capitalization Process ------------------------------------------------------- Hylsamex informs its shareholders and the investment community that, up to date, Article 7 of the Company's Be-Laws is the following: Article 7.- The capital stock is variable. The minimum fixed capital amounts to Ps.5,893'924,407 (five thousand, eight hundred ninety three million nine hundred twenty four thousand four hundred seven pesos 00/100 Mexican currency) not subject to withdrawal, represented by 599,808,993 (five hundred ninety nine million eight hundred eight thousand nine hundred ninety three) nominative, common shares, Series "B", without nominal value, accounted for as follows: (i) capital stock subscribed and paid for at August 23, 2002 amounting to Ps.4,906'192,065 (four thousand nine hundred six million one hundred ninety two thousand sixty five pesos Mexican currency) represented by 499,327,575 (four hundred ninety nine million thee hundred twenty seven thousand five hundred seventy five) shares that have been subscribed and paid for; and (ii) the rest of the capital stock amounting to Ps.987,732,342 (nine hundred eighty seven million seven hundred thirty two thousand three hundred forty two pesos Mexican currency) represented by 100'481,418 (one hundred million four hundred eighty one thousand four hundred eighteen) shares which shall be maintained in the Treasury of the Company to be delivered upon subscription and payment by the Company's shareholders. As agreed in the Extraordinary General Shareholders Meeting held on June 28, 2002, the offering period for the subscription of shares is still ongoing. The above text will be adjusted for the subscription of additional shares. ISPAT INTERNATIONAL: Extends Expiration Date For Exchange Offer --------------------------------------------------------------- Ispat International N.V. ("Ispat"), (NYSE: IST US; AEX: IST NA), announced Thursday that Ispat Mexicana, S.A. de C.V. ("Imexsa"), Ispat's Mexican operating subsidiary, has extended its exchange offer for all outstanding 10-1/8% Senior Structured Export Certificates due 2003 of Imexsa Export Trust No. 96-1 (the "Senior Certificates") by one additional day. The exchange offer will now expire at 5:00 p.m., New York City time, on September 4, 2002, unless otherwise extended or terminated by Imexsa (the "Expiration Date"). The exchange offer had been scheduled to expire at 5:00 p.m., New York City time, on September 3, 2002. As of 5:00 p.m., New York City time, on September 3, 2002, holders of 89.25% of the outstanding principal amount of Senior Certificates have tendered and not withdrawn their Senior Certificates. The exchange offer is being extended to allow remaining holders additional time to submit the documentation required under the agreed upon terms of the exchange. Requests for documentation should be made to the Information Agent for the exchange offer, D.K. King & Co., Inc., at (800) 847-4870. Questions regarding the transaction should be directed to financial advisor to Imexsa, Dresdner Kleinwort Wasserstein at (212) 969-2700. This announcement is not an offer to purchase or a solicitation of consents with respect to any Senior Certificates or an offer of New Senior Certificates for sale. Securities may not be offered and sold in the United States absent registration or an exemption from registration. Any public offering of securities to be made in the United States must be made by means of a prospectus that may be obtained from the issuer or selling security holder and will contain detailed information about the company and management, as well as financial statements. For further information, call: Annanya Sarin Head of Communications + 44 20 7543 1162 / +31 10 404 6738 T.N Ramaswamy Director, Finance + 44 20 7543 1174 John McInerney of Citigate Dewe Rogerson Investor Relations +1 212 419 4219 UNEFON: Blames Conflict With Nortel For Recent Default ------------------------------------------------------ The reason Mexican mobile telephony operator Unefon elected not to pay a US$6 million interest payment recently due on promissory notes held by its largest creditor Nortel Networks Corp was a heightened cash conservation status for the company, suggested Bear Stearns equity analyst Chris Recouso in a Business News Americas report. Exact cash levels as of late August are undetermined, but Unefon, which has about US$510 million in debt since it began operations in 2000, only has US$12 million cash on its balance sheet at end- June. If Unefon has US$6 million to spend on interest payments, that would be US$6 million cash it could not commit to other necessities, such as maintenance capital expenditures, Recouso said. Another factor that contributed to Unefon's decision to default on the debt was that it was holding back payment due to a dispute with Nortel over Unefon commercial paper owned by the vendor, Unefon chairman Moises Saba said in an interview with Mexican daily La Mexico City daily Reforma. Saba said Nortel has been selling its Unefon paper for as little as half their face value, negatively affecting Unefon's asset base and unfairly hurting its shareholders. "It is not fair of [Nortel] to leave us in that position; we have shareholders, we have to protect our investors," Saba said. In reaction to that statement, Recouso said: "This is brinkmanship. Unefon on a stand-alone basis doesn't have the ability to service all its obligations over the next 12 months." He noted that Unefon CEO Adrian Steckel had stated the same during the Company's 2Q02 conference call. In actuality, Unefon's shareholders Grupo Saba and TV Azteca appear to be publicly signaling for renegotiated terms on its US$408 million vendor financing agreement with Nortel, Recouso suggested. Unefon has drawn US$350 million of the vendor financing agreement thus far. The amortization schedule calls for a US$35 million payment in 2003, US$68 million in 2004 and the remainder, US$248 million, in 2005. The financing carries a 12.78% interest rate, according to Unefon's 2Q02 statement. Unefon is Mexico's fourth-largest mobile phone operator, with 1.2 million subscribers =========== P A N A M A =========== AES PANAMA: Completes $275M Financing for Two Hydro Facilities -------------------------------------------------------------- The AES Corporation (NYSE:AES) announced Thursday that its subsidiary, AES Panama, closed a $275 million financing round to fund construction of two hydroelectric power facilities in Panama. The seven-year, non-recourse loan is with a syndicate of 17 banks, including Banco Continental of Panama, Societe Generale, and Banco Nacional de Panama. The financing received an international investment grade rating of "BBB-" (Triple B Minus) from Fitch Ratings. The 120MW Esti greenfield hydroelectric plant and the 110MW Bayano hydroelectric facility expansion are in the advanced stages of construction. The Esti facility is expected to commence commercial operations in November 2003, and the Bayano expansion is expected to initiate commercial operations in September 2002. With the completion of these facilities, AES will have an installed generating capacity in Panama of 510MW. Paul T. Hanrahan, President and Chief Executive Officer, stated, "We are pleased to have completed this financing during a time when AES is focused on enhancing liquidity, de-levering our balance sheet and strengthening our businesses around the world. AES Panama has shown that stand-alone electric generating businesses with solid business fundamentals can attract non- recourse financing, even during a time when capital markets are extremely tight for the power industry." David Sundstrom, President and General Manager of AES Panama, commented, "AES Panama is delighted to have achieved this financing for these two facilities. With the participation of Panamanian and international banks, this is the largest private financing achieved in the history of the Panama banking sector." "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This news release may contain "forward- looking statements" regarding The AES Corporation's business. These statements are not historical facts, but statements that involve risks and uncertainties. Actual results could differ materially from those projected in these forward-looking statements. For a discussion of such risks and uncertainties, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year. AES is a leading global power company comprised of contract generation, competitive supply, large utilities and growth distribution businesses. The company's generating assets include interests in 177 facilities totaling over 59 gigawatts of capacity, in 33 countries. AES's electricity distribution network sells over 108,000 gigawatt hours per year to over 16 million end-use customers. For more general information visit our web site at www.aes.com or contact investor relations at investing@aes.com. CONTACT: AES Kenneth R. Woodcock, 703/522 1315 ===================== P U E R T O R I C O ===================== SANTANDER BANCORP/BANCO SANTANDER: Fitch Downgrades Ratings ----------------------------------------------------------- Fitch Ratings has downgraded the Individual Ratings of Santander Bancorp (SBP) and its subsidiary, Banco Santander Puerto Rico (BSPR). At the same time, due to the April 2002 redemption of the previously outstanding subordinate debt at BSPR, Fitch is also withdrawing its 'A' rating on the issue. All other ratings have been affirmed and are listed at the conclusion of this release. After years of steady performance, SBP has encountered significant difficulty in meeting historical performance thresholds, such that core profitability is considered weak. The historical performance of SBP was characterized by a stable stream of profitability, approximating 1.0% ROA. Margins were slightly leaner than peers, yet with a good track record on loan losses, earnings were compensated by lower credit expenses. These trends have reversed with the slowdown in the economy and challenges in credit quality. Generally one of the better asset quality performing banks in Puerto Rico, SBP has experienced continued deterioration of its loan portfolio to levels similar to other local peers. Increases in consumer and commercial loan charge-offs and nonperforming loans have required higher levels of provisions, squeezing SBP's profitability. Additionally, in the face of such credit issues, the company has refrained from growing its portfolio, tightened lending standards and refocused attention on building its mortgage banking. While these efforts may have some positive implications on performance going forward, reserve coverage of nonperforming loans remains low and loan losses continue to show increases. As such, management's success in addressing problems remains a challenge. Positively, SBP enjoys a good capitalization profile, one less dominated by common equity substitutes as have been seen among its peers. Capitalization will become increasingly important with the prevailing deterioration in earnings contribution and low reserve coverage. Fitch's perspective of SBP has changed in light of the company's recent deteriorating performance and weakening market position in Puerto Rico. Whereas in the recent past Fitch viewed SBP's ratings as increasingly representative of the company's stand- alone performance, SBP's ratings are now more fully indicative of the support received by its parent, Banco Santander Central Hispano. Ratings Downgraded: Santander BanCorp --Individual to 'C' from 'B/C'. Banco Santander Puerto Rico --Individual to 'C' from 'B/C'. Ratings Withdrawn: Banco Santander Puerto Rico --Long-Term Subordinate 'A'. Ratings Affirmed: Santander BanCorp --Long-Term Senior 'A+'; --Short-Term Senior 'F1'; --Support '3'. Banco Santander Puerto Rico --Long-Term Deposits 'A+'; --Long-Term Senior 'A+'; --Long-Term Preferred Stock 'A'; --Short-Term Deposits 'F1'; --Short-Term Senior 'F1'; --Support '3'. Contact: Ileana Cervantes Telephone: 1-312-368-5472 or Peter Shimkus Telephone: 1-312-368-2063 Chicago ============= U R U G U A Y ============= ANCAP: Partner Search Suffers Setback ------------------------------------- Administracion Nacional de Combustibles, Alcohol y Portland (ANCAP) is still in talks with parties interested in establishing a strategic partnership with the Uruguayan state oil company. However, it is unlikely to publish any bidding rules until such time when uncertainties holding back the plan will be resolved, Ancap director Pedro Abdala told Business News Americas. Uncertainties stem from objections to the plan as those who are opposed to it are seeking a referendum to overturn the oil law passed in December 2001. The oil law set terms for Ancap to find the strategic partner, as well as opening the refining, crude import-export markets immediately. It also ends the monopoly on importing oil products in January 2006 - as long as Ancap has secured a partner by then. The law also states that from March 2004, Ancap and its partner must lower domestic prices to match international oil product prices. The opponents must secure by January enough signatures to call a referendum, which would then seek to overturn the oil law. But what's also complicating the search for a partner is the economic crisis in Uruguay, which could, in turn, set back the opening of the market, Abdala said. Responding to this situation, the National Party - which Abdala represents on the Ancap board of directors - has now suggested a number of modifications to the law, including bringing forward the 2006 deadline for deregulating the market. Although the alliance is informal, the National Party essentially acts as a coalition partner in Congress, alongside the government's Colorado Party. The main opposition party is the left-wing Broad Front (Frente Amplio) alliance. The National Party's position is that Ancap is in a strong enough position to compete in an open market within Uruguay, regardless of whether or not it finds a strategic partner, Abdala explained. The company must undertake some efficiency improvements and sell loss-making non-core assets such as cement and alcohol production, he said. Ancap has 40% of the distribution market in Uruguay, it owns the only refinery and all the logistics system including pipelines and maritime terminals. Last week, the Colorado Party said it would accept talks with the National Party to debate changes to the law, Abdala said. CONTACT: ANCAP Central Administration Paysando s/n esq. Avenida del Libertador Montevideo, 11100 Uruguay P.O. Box 1090 Phones: +598(2) 902 0608 902 3892 902 4192 Fax +598(2) 902 1136 902 1642 Telex ANCAP UY 23168 E-mail: info@ancap.com.uy Home Page: www.ancap.com.uy Contact: Benito E. Pi eiro, Chief Executive Officer Phone +598(2) 900 2945 +598(2) 902 0608 Ext. 2253 Fax +598(2) 908 9188 ================= V E N E Z U E L A ================= SIDOR: Braces For Possible Strike Over Contract Conditions ---------------------------------------------------------- Failure to see a solution to the ongoing talks between the management and unions at Venezuelan steel maker Sidor by 3pm, September 7 will result to a strike. Business News Americas reports that Sutiss trade union began pressuring Sidor on August 27 with a 7-hour stoppage, from 5am to midday, protesting at what the union sees as a breach in the collective contract. The union argues that the "work culture" being imposed by the management makes for unfair treatment in wage calculations, and that it does not comply with the spirit of the collective contract. The union, however, is confident that the talks will likely see a solution to the conflict. "We've made a lot of progress and there is some hope that we will avoid a strike," a Sutiss spokesperson said. Sutiss, which joins some 5,400 employees under contract and another 6,000 subcontracted workers, argues that management is applying an erroneous formula to calculate vacations and holiday pay. Sidor, whose ability to pay its obligations has been hampered by low international steel prices and a slumping economy, suspended US$31.3 million interest payment on debt last December. At the end of July, the Company obtained preliminary agreement with bank creditors to have a 60-day period to restructure US$1.7 billion in debt. The preliminary agreement included writing off up to half of the Company's debt and capitalization from the government through share increase. Sidor is Venezuela's largest privately owned exporter and has installed capacity of some 3.5Mt. The company is 70% owned by the Amazonia consortium made up of Mexico's Hylsamex, Argentina's Techint group, Venezuela's Sivensa and Brazil's Usiminas. State heavy industry holding CVG owns the other 30% of Sidor. Based in southeastern Bolivar state, Sidor is Venezuela's largest private sector exporter. CONTACT: SIDERURGICA DEL ORINOCO, C.A. (SIDOR) Edificio General, Piso 9 Avda. La Estancia Chuao, Caracas 1060 Venezuela Tel: (582) 902 3800/3917/3955 Fax: (582) 993 2930 Home Page: www.sidor.com.ve/ *********** S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter Latin American is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Trenton, NJ, and Beard Group, Inc., Washington, DC. John D. Resnick, Edem Psamathe P. Alfeche and Ma. Cristina Canson, Editors. Copyright 2002. All rights reserved. ISSN 1529-2746. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Latin America subscription rate is $575 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *